The S&P has topped !!

[rubberbird]

Quote from Perseus:

bird,

just wondering if you put any stock in the 'january is indicator for the whole year' stuff? FYI i don't.

I never heard that ( I live in an insular environment). But I do think that the S&P won't see 1300 for the entire first half of 2006. I suppose that means, according to your blurb, that we are in for lower prices in the next week, to make January a "down month".

I want to thank the new ET'ers on this thread, who are actually talking 'stock market', and not jealously attacking like the regular maggots and vermin i'm used to around here. There's hope for ET after all!

 

[Pabst]

Nice call. As always bro.

BTW: As we saw in '87 a changing of the guard at the top of the Fed ain't a bull item either.

Quote from rubberbird:

That's some wild ride you've been on then! That would be too nerve racking for me, but more power to ya!

What will cause the decline? You answered the question yourself, higher interest rates. 1) They'll filter through to earnings. 2) commodity prices and metal prices are out of control, and it's the job of the Fed to keep these in check. The only solution is continued higher rates.

3) this year of the presidential cycle is not a favorable one for the markets.

 

[Perseus]

I never heard that ( I live in an insular environment). But I do think that the S&P won't see 1300 for the entire first half of 2006. I suppose that means, according to the quote, that we are in for lower prices in the next week, to make January a "down month".

it's just statistics- a down january tends to portend a down year and vice versa. backward looking.

also the bonds seem to be faltering as well, wondering if you had a comment on that. In general bonds falling and stocks falling doesn't seem to good.

 

[newbunch]

Quote from Buy1Sell2:

Nov 25 was the last peak on the MACD and is where the bearish divergence is drawn from.

Quite a coincidence that this is the exact day I went short. I have a quant system I built and I don't even use MACD (though I have other, similar indicators), so that is quite interesting.

 

[newbunch]

Quote from rubberbird:

That's some wild ride you've been on then! That would be too nerve racking for me, but more power to ya!

Not really. I'm only 67% short. So I was down only a couple of percent when the market hit it's high. On the other hand, I have a larger position in bonds which has actually been more volatilie since then (0.9% for the 10-yr vs 0.8% for the S&P weekly stdev) whereas it is usually less volatile (0.8% vs 2.0%)

 

[newbunch]

Quote from rubberbird:

What will cause the decline?

As I said, I have a quant system. I know the factors that go into it, but I don't always know what is causing the system to take the position it has.

However, some obvious negatives are slowing earnings, the flat yield curve, and lost momentum.

 

[Buy1Sell2]

you may notice that the day after you shorted, the market had a nice down day and then had a lot of sideways etc for a while and then had the big up on 01/03. The trade on 11/28 created the first divergence on MACD Histogram, but was minor as the 11/25 peak was very near the 11/11 peak. Many times I ignore that first divergence when it is so close like that or if I short, I use an extremely tight stop. The peak on MACD Histogram on 01/12 was much lower than the peak on 11/25 and that's the type of dicergence I like to trade. You had picked a decent place to short, but I feel that a stop should have been above 1273 somewhere-- 1276 say.

 

[rubberbird]

Quote from Pabst:

Nice call. As always bro.

BTW: As we saw in '87 a changing of the guard at the top of the Fed ain't a bull item either.

Thanks Pabst.

Some of the stuff on ET really makes me laugh. And you, my friend, had one of the all-time great lines that I still chuckle to. babak was trying to make a point that great traders like tony oz can share systems without it interfering with the success of such system. To which you exclaimed, "babak, are you on drugs? tony oz is a vendor!" you were 100% correct about that scamster, but the delivery was still very funny.

 

[doublea]

Hey Bird: You might like this:

http://biz.yahoo.com/tm/060124/13831.html

I got stopped out of the yesterday's longs and entered a short position at the close with stop at 1277.25.

In the past I have noticed that the market takes off to the upside when there is a slight decline in crude but today crude declined more than $1 and still there was pretty decent selling in YM, NQ and ES for most of the day. So when the news is good and market doesn't go up, SELL--- SELL--- SELL. Forget about 1300 we might not even see 1275 in Jan!!!!!

 

[newbunch]

Quote from Buy1Sell2:

you may notice that the day after you shorted, the market had a nice down day and then had a lot of sideways etc for a while and then had the big up on 01/03. The trade on 11/28 created the first divergence on MACD Histogram, but was minor as the 11/25 peak was very near the 11/11 peak. Many times I ignore that first divergence when it is so close like that or if I short, I use an extremely tight stop. The peak on MACD Histogram on 01/12 was much lower than the peak on 11/25 and that's the type of dicergence I like to trade. You had picked a decent place to short, but I feel that a stop should have been above 1273 somewhere-- 1276 say.

Yes, I see that now. I noticed the divergence early last week. But I obviously didn't know about it when I went short. But my system doesn't need me to notice these things.